Vol 9, Issue 1 (January 2008)
Need to know
- AIN’T DEAD YET
* GWI’s final analysis of the performance of listed water stocks in 2007 (see pp8-15) suggests a fourth consecutive year of outperformance versus the main stock market indices.
- DEVELOPMENT DEALS
* Veolia looks set to open up new markets in Africa and India after taking on an investment from the International Finance Corporation (IFC).
- NEW YEAR, NEW JOB
* Roger Radke has moved on from the top spot at Siemens Water Technologies to run the German group’s medical division
- RAINY RAINY RATTLESTONES
* The drought in the American south west seems to have been washed away by rains over the holiday period.
- Insight – David Lloyd Owen
Going underground – does the private equity sector’s lack of visibility have implications for our invisible assets?
- Water’s tipping point
Christopher Gasson is optimistic about the outlook for 2008.
- Abberton enlargement moves forward
Construction work on the UK’s largest reservoir project in 25 years could start as early as 2010, after Northumbrian Water formally submitted its plans in December.
- An ode to Odebrecht
The Brazilian construction company continues to make further inroads into the water sector, taking over the Mauá concession, and deftly reneging a stalled PPP.
- Anglian’s forecast hinges on the weather
Anglian Water has set out its vision for the next 25 years. It expects to more than double its debt burden by 2035 in order to meet capex needs.
- Aqua America’s pruning policy
The race to acquire water assets has inevitably left a few underperforming systems on Aqua America’s books. Now CEO Nick DeBenedictis is looking to spruce up his portfolio by pruning off the withered branches.
- Aquapor privatisation hots up
The sale of state-owned Portuguese water holding Aquapor is set to move ahead later this month. Evaluating the company could prove complicated.
- Aussie local councils “short-changed”
An A$1.9 billion compensation package for local councils’ bulk water assets has been dubbed insufficient. It could bring about some steep tariff rises.
- Befesa chalks up win in Angola
The Spanish developer has taken a bold step forward by signing a drinking water supply agreement in Angola.
- Beijing Capital makes it big in Hunan
The polluted Xiangjiang River basin is at the heart of an ambitious wastewater initiative in China’s Hunan Province. GWI’s China editor Kathy Liu investigates.
- Cascal eyes $365m NYSE listing
Biwater is set to spin off its concessions arm later this month. It will be the first test of investor appetite for new water stocks in what will be a busy year for water IPOs.
- Catalunya targets industrial water reuse
The Catalan government is working with local industry on an ambitious water reuse scheme. Although interest is high, recovery of the initial investment could prove tricky.
- Copasa secondary share offering to price 23 Jan
Copasa’s shares are set to receive an imminent liquidity boost. The sellers may not get the price they had been hoping for.
- DEWA issues P Station RFPs
Bid deadlines have been set for the first stages of the massive power and water development at Hassyan in Dubai. Interest has been lukewarm.
- E.ON’s ambition drives municipal stake sales
E.ON Avacon’s urgent need to divest stakes in two municipal water and energy firms resulted in a brace of bargain sales in December.
- EPM considers private concessions
Private water operators could benefit from the utility’s expansion plans.
- Gelsenwasser’s Algerian ambitions
The German water operator is hoping to leverage off its recent success in Annaba to extend its footprint in the Algerian water sector.
- Henkel sells water treatment arm for €60m
Henkel has sold its industrial water treatment business. The buyer is Israeli, but the German link remains.
- Israel receives water reuse boost
A new tertiary treatment standard will enable more water to be recycled for agriculture in Israel. A mix of new facilities and retrofits will be required.
- Israeli desal market assesses new competition proposal
Israel could allow private investors to sell desalinated water directly to endusers. The prospect of competing directly with Mekorot may deter some.
- Joined-up thinking for Australia
Commissioner Peter Cullen sees a wider role for the private water industry in shaping Australia’s water future. Education and better knowledge transfer are top of the list.
- London calling
Alison Ireland introduces our 2008 conference and reminds you to nominate your projects for this year’s Global Water Awards.
- Queensland turns to mobile desal
Government officials in Queensland are backing a pair of temporary desalination plants. Rainfall in the first quarter will determine if they go ahead.
- Sedapal mulls asset-backed bond
Sedapal could enter the capital markets this year. It will only fund a tiny fraction of the investment required to revamp Peru’s water infrastructure.
- Spain simplifies access to water data
A new system run by the Spanish environment ministry brings key water resource statistics together.
- Suez & Mitsui preferred for Ras Laffan C IWPP
Key project documentation for Qatar’s latest IWPP is set to be signed at the end of February. The in-house financing structure has raised a few eyebrows.
- Suez and la Caixa reinforce Agbar acquisition agreement
Agbar’s heavyweight shareholders have tightened their grip on the Catalan company even further. Board meetings will never be the same again.
- Veolia AMI brings in development agencies to enhance PPP strategy
For the second time in as many months, international development banks have subscribed to a capital increase in a Veolia regional subsidiary. What are the benefits?
- WATER STOCKS REVIEW - 2008 – the year of the water IPO
For a long time investors have complained that there are not enough water stocks. Extra capacity is on the way.
- WATER STOCKS REVIEW - Asian water in 2007 – the bull makes a splash
Asia was again the pick of the bunch last year as far as listed water stocks were concerned. Those with Chinese exposure continue to look like a good bet, says Frédéric Blanc-Brude.
- WATER STOCKS REVIEW - European water stocks take a step back
M&A speculation and associated volatility helped attract a new breed of investor to listed European water stocks in 2007. The market could not match the gains it made in 2006.
- WATER STOCKS REVIEW - Sub-par Sanepar bucks Brazilian trend
Sabesp and Copasa had an encouraging year in 2007, though tariff freezes at Sanepar meant the stock failed to match the performance of its peers.
- WATER STOCKS REVIEW - Suitably equipped for future growth
North American water equipment suppliers generally showed a positive trend in 2007. Skeletons in the cupboard took the shine off some stocks’ performance, however.
- WATER STOCKS REVIEW - US water utilities disappoint in 2007
With few exceptions, the publicly-traded US water utilities put in a poor performance in 2007. It has forced some to re-think their value creation strategies.
- WATER STOCKS REVIEW - Water stocks moved east in 2007
Despite the weakness of US utilities, the water sector outperformed the main market indices for the fourth year running last year. Maximising investment returns was dependent on a strong appetite for Chinese water stocks.
- IN BRIEF – AMERICAS
* Aqua America rounded out 2007 with a flurry of acquisition announcements, taking its total for the year to around 27, by our calculations.
- IN BRIEF – ASIA
* SembCorp has won the contract for the 50MGD (189,250m<sup>3</sup>/d) NEWater plant at Changi in Singapore.
- IN BRIEF – EUROPE
* A €14.5 million infrastructure improvement project implemented by the Plovdiv Regional Water Company in Bulgaria will benefit from a €11.4 million loan from the EBRD.
- IN BRIEF – MIDDLE EAST
* Algeria’s desalination programme has seen a further two projects reach financial close in the past month.
- A market committed to paper
Paper ranks highly in the “virtual water” stakes. Efficiency is not the only driver behind innovation in the industry, as Gord Cope discovers.